The LLC was introduced by the Limited Liability Company Act 2016 (LLC Act), which was passed in the Senate in July 2016 and became operative on 1 October 2016.

The new legislation provides an additional option for those structuring investment funds, private equity vehicles and investment holding vehicles. As it is modelled on the Delaware LLC, it will be familiar to those that do business with the United States.

This commonality with the Delaware LLC is one of the many benefits of using an LLC to structure investment vehicles. The LLC allows greater consistency between onshore/offshore structures and will potentially reduce implementation costs when using documentation employed by onshore vehicles. American managers using a Delaware LLC onshore now have the option of forming a Bermuda LLC offshore.

The LLC is a hybrid legal vehicle that has many of the features of a partnership with separate legal personality – but within a corporate entity. The LLC also has much of the flexibility of a partnership and the terms of the LLC agreement – including operations, management and allocations of profits – can be made bespoke.

Like a company limited by shares and a limited partnership, the liability of an LLC’s member is limited.

Bermuda exempted companies have separate legal personality but must maintain a share capital while an exempted limited partnership has greater contractual flexibility in relation to capital accounting provisions. The members of an LLC have an interest in a capital account like a partnership.

Read More

Twitter LinkedIn Email Save as PDF
More Publications
5 Dec 2022

Business Crime and Investigations in Bermuda: Overview

A Q&A guide to business crime and investigations in Bermuda.

24 Nov 2022

Information Technology, Outsourcing, Privacy & Data Protection

All aspects of Bermuda's economy rely on information technology and data processing - an essential i...

Contributors: Duncan Card
22 Nov 2022

A Look Back on 2022 and What to Expect for 2023

As we approach the end of 2022, we are able to look back and say with certainty that the arena of la...

14 Nov 2022

When will the court enforce a promise?

As we all know, promises are made and broken all the time. What, if anything, can the law do to assi...

4 Nov 2022

Legally speaking: what not to do when outsourcing operations

In the course of my career, I have drafted, negotiated or otherwise provided commercial and legal ad...

1 Nov 2022

The Insolvency Review – Edition 10

The Insolvency Review offers an in-depth review of the most consequential features of the insolvenc...

25 Oct 2022

Bermuda: Mergers & Acquisitions Comparative Guide 2022

This country-specific Q&A provides an overview to Mergers & Acquisitions laws and regulati...

Contributors: Katie Blundy
24 Oct 2022

Directors’ duties on the eve of insolvency

It is common knowledge that directors of companies owe a duty to the company to act in its best inte...

Contributors: James Batten
13 Oct 2022

Employee probation periods: an update

The Employment Act 2000 is the island’s key piece of employment legislation, applicable to employe...

Contributors: Kiara Wilkinson
6 Oct 2022

Centre Stage: Bermuda’s Role In An Insurtech Revolution

Bermuda is rapidly becoming a focus for insurtechs seeking the island’s expertise, the accessibili...